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☆ Asian shares stutter, dollar buoyant as data supports hawkish Powell
▼ + stars: | 2023-03-09 | by ( Stella Qiu | ) www.reuters.com time to read: +5 min

MSCI's broadest index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS) eased 0.2% on Thursday, extending a drop of 1.4% the previous session. S&P 500 futures eased 0.1% and Nasdaq futures were off 0.3%Inflation data out of China showed on Thursday that domestic demand still remained tepid. The U.S. dollar index, measuring the greenback's value against a basket of major peers, hovered close to a three-month top at 105.6. The central bank on Wednesday left its key overnight interest rate on hold, becoming the first major central bank to suspend its monetary tightening campaign. On Thursday, the two-year Treasury yields held close to its 15 year highs at 5.0553%, while the benchmark 10-year yields were steady at 3.9775%.

Ahead of crucial U.S. jobs data on Friday, MSCI's broad index of global stocks (.MIWO00000PUS) fell 0.3%. This view has clashed with market repricing of interest rate expectations and bond market signals that aggressive monetary tightening raises recession risks. "If the totality of the data were to indicate that faster tightening is warranted, we would be prepared to increase the pace of rate hikes," Powell said. U.S. Treasury yields continued an ascent on Wednesday, with the two-year yield, which tracks interest rate expectations, briefly touching 5.08% -- its highest level since 2007. After a series of jumbo hikes last year, the Fed raised rates by 25 basis points last month.

Higher rates benefit the dollar by improving its yield and as traders look for safety while global stockmarkets drop. The dollar hit a two-month high against the euro of $1.0524 , extending Tuesday's 1.2% jump. The Australian dollar has weakened for a similar reason as the Reserve Bank of Australia has softened its tone. Having dropped over 2% on Tuesday, the Australian dollar weakened a bit more to hit a four-month low of $0.6568 on Wednesday. China's yuan finished the domestic session at 6.9706 per dollar, the weakest such close since Dec. 29, 2022.

☆ Powell's warning on higher U.S. rates pushes dollar to 3-mth high
▼ + stars: | 2023-03-08 | by ( Tom Westbrook | ) www.reuters.com time to read: +3 min

Higher rates benefit the dollar by improving its yield and as traders look for safety while global stockmarkets drop. The dollar hit a two-month high of $1.0528 to the euro , extending Tuesday's 1.2% jump. The Australian dollar has weakened for a similar reason as the Reserve Bank of Australia has softened its tone. Futures imply U.S. rates peaking above 5.6% and holding higher than 5.5% through 2023. The U.S. dollar index rose 0.2% in Asia trade to a more than three-month high of 105.86.

☆ Asian stocks tumble, dollar gains after hawkish Powell comments
▼ + stars: | 2023-03-08 | by ( Ankur Banerjee | ) www.reuters.com time to read: +4 min

The hawkish comments from Powell sent U.S. stocks sharply lower, with the risk-off mood continuing in Asian trade. Eurostoxx 50 futures were down 0.19%, German DAX futures fell 0.27% and FTSE futures were down 0.27%. After a series of jumbo hikes last year, the Fed raised rates by 25 basis points in its last two meetings. "Powell has essentially opened the door to 50 basis point hike," said Chris Weston, head of research at Pepperstone. Citi strategists said even as-expected payrolls and inflation data could keep the chance of a 50 basis point hike high.

☆ Asian stocks tumble after hawkish Powell comments
▼ + stars: | 2023-03-08 | by ( Ankur Banerjee | ) www.reuters.com time to read: +3 min

SINGAPORE, March 8 (Reuters) - Asian shares fell sharply on Wednesday, while the dollar advanced after hawkish comments from Federal Reserve Chair Jerome Powell raised the possibility of the U.S. central bank returning to large rate hikes to tackle sticky inflation. The Fed will likely need to raise interest rates more than expected in response to recent strong data, Powell said on the first day of his semi-annual, two-day monetary policy testimony before Congress. The hawkish comments from Powell sent U.S. stocks sharply lower, with the risk-off mood continuing in Asian trade. MSCI's broadest index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS) was 1.45% lower, while Australia's S&P/ASX 200 index (.AXJO) fell 0.70%. "Powell has essentially opened the door to 50 basis point hike," said Chris Weston, head of research at Pepperstone.

☆ Powell pushes dollar to three-month high
▼ + stars: | 2023-03-08 | by ( Tom Westbrook | ) www.reuters.com time to read: +3 min

SINGAPORE, March 8 (Reuters) - The dollar was riding high on Wednesday, flung to three-month peaks when Federal Reserve Chair Jerome Powell surprised investors by warning that interest rates might need to go up faster and higher than expected to rein in inflation. Overnight it had shot more than 1.2% higher on the euro, its biggest one-day move in five months. The U.S. dollar index , which measures the dollar against a basket of six major currencies, jumped 1.3% overnight to a three-month peak of 105.65. The blockbuster week of central bank meetings and speakers rolls on later in the day, with the Bank of Canada setting policy and European Central Bank President Christine Lagarde speaking. "If they don't hike, the Canadian dollar will likely fall into a bucket of currencies where the central bank is unwilling to keep up with the Fed."

☆ Jerome Powell isn't winning any popularity contests among investors as markets booed his testimony on Tuesday
▼ + stars: | 2023-03-08 | by ( Phil Rosen | ) www.businessinsider.com time to read: +6 min

If you missed Jerome Powell's remarks from his first day on Capitol Hill yesterday, the TLDR is that more rate hikes are coming because the economy's still running hot. The market response to Powell's testimony was anything but muted. The idea is to eventually lower inflation — which most recently clocked in at 6.4% — but the more rate hikes we see, the greater the risk of a recession. So in short: stocks sold off, bond yields jumped, and traders eyed greater potential for a bigger rate hike this month. "If the totality of the data were to indicate that faster tightening is warranted, we would be prepared to increase the pace of rate hikes," Powell said.

☆ Wall St ends sharply lower, Treasury yield inversion widens after Powell remarks
▼ + stars: | 2023-03-07 | by ( Stephen Culp | ) www.reuters.com time to read: +4 min

"It's a pretty classic risk-off day," said Ross Mayfield, investment strategy analyst at Baird in Louisville, Kentucky. MSCI's broadest index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS) closed 0.81% lower, while Japan's Nikkei (.N225) rose 0.25%. Benchmark Treasury yields dipped after Powell's remarks, and the inversion between 2-year and 10-year Treasury yields, a harbinger of potential recession, steepened. Benchmark 10-year notes last rose 4/32 in price to yield 3.9696%, from 3.983% late on Monday. The 30-year bond last rose 18/32 in price to yield 3.8794%, from 3.912% late on Monday.

☆ Wall Street slides, Treasury yield inversion widens after Powell remarks
▼ + stars: | 2023-03-07 | by ( Stephen Culp | ) www.reuters.com time to read: +4 min

REUTERS/Andrew Kelly/File PhotoNEW YORK, March 7 (Reuters) - Wall Street stocks plunged, the greenback surged and Treasury yields dipped on Tuesday as Federal Reserve Chairman Jerome Powell concluded the first day of his semi-annual, two-day monetary policy testimonial before Congress. In a broadly risk-off session, the dollar gained strength and inversion between short- and long-dated Treasury yields touched their widest since 1981 as the testimony reaffirmed the Fed's determination to bring inflation down to its 2% target rate. European shares extended their losses after Powell's prepared remarks fueled rate hike worries. Benchmark Treasury yields dipped after Powell's remarks, and the inversion between 2-year and 10-year Treasury yields, a harbinger of potential recession, hit its steepest differential in over four decades. Benchmark 10-year notes last rose 2/32 in price to yield 3.9754%, from 3.983% late on Monday.

☆ Analysis: U.S. stocks’ early-year rally is melting away as Treasury yields surge
▼ + stars: | 2023-02-22 | by ( David Randall | ) www.reuters.com time to read: +4 min

NEW YORK, Feb 22 (Reuters) - Cracks are widening in an early-year rally in stocks, as rising Treasury yields bolster the allure of bonds and skew equity valuations. Stocks are still sitting on sizeable year-to-date gains, though some of their rally has melted away in recent days. The S&P 500 (.SPX) is down 4.4% from its recent highs, but remains up 4.1% year-to-date. That is a "death zone" that makes the "risk-reward very poor" for stocks, strategist Michael Wilson wrote. To be sure, bullish investors might have history on their side, thanks in part to January’s hefty 6.2% gain for the S&P 500.

☆ Stocks are jumping as investors bet on a 'pivot' away from interest rate hikes. Here's why experts think the path might be much more complicated.
▼ + stars: | 2023-02-09 | by ( Marley Jay | ) www.businessinsider.com time to read: +4 min

Investors hope the Federal Reserve will soon "pause" interest rate hikes and cut them before long. Stocks have been on a roll in early 2023, and one reason is that investors think the Federal Reserve is very close to changing course on interest rates. The more interest rates rise, the more the economy will slow and the more likely a recession becomes. Along similar lines, Bank of America interest rate strategist Ralph Axel told Morningstar in December that he expects "multiple pivots" from the Fed. "A Fed pause is undoubtedly worth some lift to stocks but once again we want to remind readers that both bonds and stocks have rallied already on that conclusion."

☆ I see this year's budding stock rally signaling a different kind of bull market, one that's not so reliant on just a few stocks
▼ + stars: | 2023-01-29 | by ( Jim Cramer | ) www.cnbc.com time to read: +11 min

This nascent bull market started with the peak in interest rates and the dollar back in the fall and then broadened to include bank and semiconductor stocks in 2023. That's right we created FANG a decade ago this week on "Mad Money," and it was a really good call — until it wasn't. The stability of a market that's based, in part, on the assumption of a JPMorgan (JPM) or an American Express or even a Boeing rallying on earnings, seems tidal to me. That's what's happening as we consider the market to be far bigger than any group of a half-dozen stocks. Yes, I am shredding the cynicism and heralding the new bull market, one that's not ignorant of what ails things, but is benignly rotational.

☆ U.S. consumer spending falls; inflation cooling
▼ + stars: | 2023-01-27 | by ( ) www.reuters.com time to read: +2 min

Consumer spending, which accounts for more than two-thirds of U.S. economic activity, dropped 0.2% last month, the Commerce Department said on Friday. Economists polled by Reuters had forecast consumer spending dipping 0.1%. In the 12 months through December, the PCE price index increased 5.0% after advancing 5.5% in November. Excluding the volatile food and energy components, the PCE price index rose 0.3% after climbing 0.2% in November. The so-called core PCE price index rose 4.4% on a year-on-year basis in December after increasing 4.7% in November.

☆ Wall Street extends rally, powered by tech bounce
▼ + stars: | 2023-01-23 | by ( Stephen Culp | ) www.reuters.com time to read: +5 min

All three major stock indexes extended Friday's gains, with the tech-heavy Nasdaq leading the pack, boosted by semiconductor shares (.SOX). Of the 11 major S&P 500 sectors, all but energy (.SPNY) ended green, with tech shares (.SPLRCT) enjoying the largest percentage gain, up 2.3% on the session. The fourth-quarter reporting season has shifted into overdrive, with 57 of the companies in the S&P 500 having posted results. Analysts now see S&P 500 fourth-quarter earnings, on aggregate, dropping 3% year-on-year, nearly twice as steep as the 1.6% annual drop seen at the beginning of the year, per Refinitiv. The S&P 500 posted 11 new 52-week highs and no new lows; the Nasdaq Composite recorded 82 new highs and 19 new lows.

☆ Wall Street surges, powered by tech rebound
▼ + stars: | 2023-01-23 | by ( Stephen Culp | ) www.reuters.com time to read: +4 min

"No one wants to be watching from the sideline with a bunch a cash as the market gets away from them." All 11 major sectors in the S&P 500 were higher, with tech (.SPLRCT) up the most, jumping 2.8%. Fourth-quarter reporting season has shifted into overdrive, with 57 of the companies in the S&P 500 having posted results. Of those, 63% have delivered better than expected earnings, according to Refinitiv. The S&P 500 posted 11 new 52-week highs and no new lows; the Nasdaq Composite recorded 66 new highs and 14 new lows.

☆ U.S. economy losing momentum as retail sales post biggest drop in 12 months
▼ + stars: | 2023-01-18 | by ( Lucia Mutikani | ) www.reuters.com time to read: +7 min

The second straight monthly decrease in retail sales, which are mostly goods, is undercutting production at factories. Retail sales plummeted 1.1% last month, the biggest drop since December 2021. REUTERS/Jeenah Moon 1 2Retail salesMANUFACTURING OUTPUT FALLSExcluding automobiles, gasoline, building materials and food services, retail sales fell 0.7% last month. The weakness in core retail sales is likely to be offset by anticipated gains in services spending. The government reported last week that monthly consumer prices fell for the first time in more than 2-1/2 years in December.

☆ Stocks rise, dollar stumbles after U.S. inflation data
▼ + stars: | 2023-01-12 | by ( Chuck Mikolajczak | ) www.reuters.com time to read: +3 min

[1/3] Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., November 7, 2022. U.S consumer prices fell in December for the first time in more than 2-1/2 years as prices fell for gasoline and other goods, suggesting inflation was on a sustained downward trend. Many market participants are looking for signs of weakness in the labor market as a signal of slowing inflation. On Wall Street, equities were choppy after the data, with the S&P 500 falling as much as 0.8% and then rebounding. Crude prices rose in the wake of the data, getting an additional boost from optimism over China's emergence from its COVID-19 restrictions creating additional demand.

☆ Stocks climb, dollar falls after U.S. inflation data
▼ + stars: | 2023-01-12 | by ( Chuck Mikolajczak | ) www.reuters.com time to read: +3 min

Still, a separate reading on the labor market showed weekly initial jobless claims came in at 205,000, below expectations of 215,000. Many market participants are looking for signs of weakness in the labor market as a key sign of slowing inflation. On Wall Street, equities were choppy after the data, with the S&P 500 falling as much as 0.8% before rebounding. Richmond Federal Reserve president Tom Barkin echoed the sentiment about the data and said it allowed the Fed to "steer more deliberately". Crude prices rose in the wake of the data, getting an additional boost from optimism over China's emergence from its COVID-19 restrictions creating additional demand.

☆ Stocks gain, yields fall after U.S. inflation data
▼ + stars: | 2023-01-12 | by ( Chuck Mikolajczak | ) www.reuters.com time to read: +3 min

Still, a separate reading on the labor market showed weekly initial jobless claims came in at 205,000, below expectations of 215,000. Many market participants are looking for signs of weakness in the labor market as a key sign of slowing inflation. On Wall Street, equities were choppy after the data, with the S&P 500 falling as much as 0.8% before rebounding. "The fact that we have seen core inflation decelerate to 5.7% year-over-year, from 6% in November, reinforces the peak inflation argument." Crude prices rose in the wake of the data, getting an additional boost from optimism over China's emergence from its COVID-19 restrictions creating additional demand.

☆ The December jobs report sent mixed signals. Here's what it means for markets.
▼ + stars: | 2023-01-09 | by ( Phil Rosen | ) www.businessinsider.com time to read: +6 min

The December jobs report is another data point that signals the Fed has more work to do to cool the economy. "A labor market this strong means an imminent recession is highly improbable," Indeed Hiring Lab economist Nick Bunker wrote in a note. While stocks usually sell off after these strong reports, fearing the worst from the Fed, Friday saw a strong rally. History suggests there are very strong odds the stock market gains 20% this year after last year's bludgeoning. Tesla stock has tumbled to multiyear lows.

☆ Here’s how to invest in the stock market next year, according to Bank of America
▼ + stars: | 2022-12-08 | by ( Phil Rosen | ) www.businessinsider.com time to read: +6 min

"Once rate hikes bite labor markets, the Fed will pause, and investors should deploy the $1.9 trillion," Bank of America strategists said. With a new normal of elevated inflation, BofA expects equal-weighted stock market indices to perform better than market-cap-weighted ones. How will you adjust your stock market investing strategy for the new year as recession signals heat up? The legendary investor estimated that policymakers may push the benchmark rate as high as 5.5%, which he warned could weigh especially heavily on the stock market. The stock market's recent run is due to fail even as investors are anticipating a Fed pivot ahead.

☆ US stocks climb as the S&P 500 looks to snap its 5-day losing streak
▼ + stars: | 2022-12-08 | by ( Phil Rosen | ) www.businessinsider.com time to read: +1 min

US stocks ticked higher Thursday, following five consecutive losing sessions for the S&P 500. Investors are eyeing next week's Federal Reserve meeting, where policymakers are expected to make a half-point interest rate hike. Sign up for our newsletter to get the inside scoop on what traders are talking about — delivered daily to your inbox. On Thursday, the Labor Department reported that claims for unemployment benefits increased 4,000 to 230,000 in the week ending December 3. Traders are largely betting on a 50-basis-point hike at the FOMC meeting next week, according to CME's FedWatch tool.

☆ Here's the 2023 playbook stock market investors should follow as they sit on a $2 trillion cash pile, according to Bank of America
▼ + stars: | 2022-12-07 | by ( Matthew Fox | ) www.businessinsider.com time to read: +3 min

Investors are sitting on a $2 trillion cash pile, but they should wait before investing it in stocks. Bank of America said "timing is everything" and investors will see stock buying opportunities in early 2023. "History reveals superlative returns after the last Fed hike," Bank of America said. "Active US household investors, the $40 trillion whale in equity markets, never sold aggressively enough in 2022 to reverse the $4.2 trillion equity inflows since COVID." BofA expects new market leadership in 2023 as 5% inflation levels become the new normal, compared to prior years of just 2%.

☆ Dow falls more than 300 points as US stocks extend losses on interest rate fears
▼ + stars: | 2022-12-06 | by ( Matthew Fox | ) www.businessinsider.com time to read: +2 min

US stocks finished lower on Tuesday as investors cast doubt on the Fed easing rate hikes. A strong November jobs report and solid GDP data suggests a resilient economy may keep the Fed hiking rates for longer. The S&P 500 extended its two-day decline to more than 3% as its 200-day moving average remains a big resistance level. The Fed is largely expected to hike interest rates by 50 basis points at its FOMC meeting next week, a step down from its four straight 75-basis-point interest rate hikes. Last week's strong November jobs report and continued resilience in quarterly GDP data shows that the economy is holding up well despite the Fed's near-400 basis points of interest rate hikes made so far this year.

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